All About Car Insurance in California

Drivers in California must carry a minimum amount of liability car insurance. Find out about other requirements for California drivers.

September 8, 2017 ·

by Cheryl Knight

The high traffic volumes in parts of California usually mean higher premiums for drivers who live in large cities, such as Los Angeles, San Diego, and the San Francisco Bay area. State laws regulate exactly how much liability insurance you must carry if you drive a car, but premium amounts vary according to which car insurance company you choose.

But exactly how much liability coverage do you need in California, and what other restrictions apply if you drive a car in the state?

Car insurance is required in California

California requires that you carry a minimum amount of liability and uninsured motorist coverage for each car you own. The state does not require you to carry comprehensive or collision coverage; however, your lender probably does.

If you live in California, you must carry the following liability insurance minimums:

$15,000 of bodily injury coverage per person per accident

$30,000 of bodily injury coverage per accident

5,000 of property damage coverage per accident

In addition to liability coverage, California also requires you to carry a specific amount of uninsured motorist insurance in the following amounts, unless you elect to reject the coverage by speaking to your agent:

$15,000 of bodily injury coverage per person per accident

$30,000 of bodily injury coverage per accident

$3,500 of property damage coverage per accident

Do you need to keep proof of insurance inside your car?

In the state of California, you need to provide proof of insurance to register your car each year. In addition, you must keep a copy of your insurance card, provided by your car insurance company upon signing up for insurance, in your car at all times in case you need to prove the vehicles is insured, such as in the event of an accident or traffic stop.

Consider placing the copy of your insurance card in your glove box, or somewhere else easily accessible, so that other drivers in your vehicle can present the card if they drive your vehicle without you.

Your insurance card contains the following information:

Your car’s information, such as make, model, and year

Your name and the name of any other drivers on your insurance policy

The expiration date of your current insurance policy

Each time you renew your policy, you receive a new insurance card, which contains any updated information since the last time you renewed. When renewing your insurance policy, your insurance company reports your renewal electronically to the California DMV, which the DMV uses to verify that you have car insurance when renewing your registration.

What happens if you get pulled over in California?

Usually, when you get pulled over for a traffic stop in California, the law enforcement official asks for a valid California driver’s license, car registration, and proof of insurance. If you fail to show proof of insurance, or another form of financial responsibility, you can receive a fine ranging from $100 to $200 for a first offense and a fine ranging from $200 to $500 for any additional offense within three years of the first.

In addition, a court in the state of California can order your car impounded until such a time as you can show proof of insurance.

What happens if your driver’s license is taken away or suspended?

When you have your license revoked or suspended, you don’t automatically lose your insurance. State laws prohibit insurance companies from cancelling a policy mid-term, so as long as you don’t drive, you should have no problems. Of course, once your policy term expires, your insurance might not get renewed. If a car insurance company does not renew your policy, they have to give you a written notice informing you of the non-renewal.

Getting caught driving without a license or on a suspended license can result in you losing your insurance immediately and needing to acquire an SR-22 before you can reacquire insurance coverage. Even in a case such as this, the insurance company still needs to inform you of the cancellation in writing.

What happens if you have a DUI in California?

A Driver Under the Influence (DUI) violation results in the need for you to file an SR-22, especially if it’s not your first offense. With a DUI, expect to lose your current car insurance policy. You can get insurance with a DUI, but monthly premiums typically range three to five times higher than what you normally pay without a DUI.

What is an SR-22?

When seeking insurance following a DUI or when getting your license reinstated, you need to file an SR-22 form in California first. An SR-22 verifies that you meet state minimum liability coverage requirements for car insurance.

While you have an active SR-22 filed, your insurance company places you in a special high-risk category where you have to pay much higher premiums than somebody without an SR-22. The SR-22 stays on your record for three years, at which time it comes off of your driving record and you qualify for lower car insurance premiums once again.

What is a good driver discount policy?

The state of California also offers residents a good driver discount policy, which gives you a 20% discount if you meet certain requirements. To qualify for the good driver discount you must have:

Had a valid California driver’s license for the past three years

Not had more than one point on your driving record due to a traffic violation

Not taken a traffic school class due to a traffic violation more than once

Not had an accident where you were at-fault that resulted in an injury or death

California’s Low Cost Automobile Insurance (CLCA) program

California’s Low Cost Auto Insurance Program (CLCA) provides affordable liability insurance for low-income drivers. The premiums for a CLCA policy caps out at $388 annually as of this printing, according to DMV.org, but you might find a lower premium depending on where you live. To qualify for CLCA coverage, you must:

Meet certain income eligibility requirements usually dependent on the number of people living in your household and their combined incomes

Maintain a good driving record

Meet an age requirement of at least 19 years old

Carry a valid California driver’s license

Own a car valued at $20,000 or less, with nothing owed on the car

In addition to lower premiums, drivers who have a CLCA policy also qualify for lower minimums when it comes to California liability laws. In essence, CLCA coverage liability limits come out to:

$10,000 of bodily injury coverage per person per accident

$20,000 of bodily injury coverage per accident

$3,000 of property damage coverage per accident

Who are the most common insurance providers in California?

The state of California is home to many different car insurance companies. While all of them sell the same basic types of insurance coverage, premium amounts differ according to company, as shown on the chart below from ValuePenguin:

How to report an accident and file a car insurance claim in California

Following a car accident, after checking the well being of everyone involved, you should collect specific information from the other driver and passengers involved, including:

The names of the other drivers

The owner of the other cars involved, if different than the drivers

The name of any passengers, their addresses, and their phone numbers

The year, make, and model of the vehicles involved

The name of any witnesses to the accident, their addresses, and their phone numbers

Next, contact your insurance company. You can do this via the phone number on your car insurance card. When talking to an adjuster or agent with the insurance company, make sure to stick to the facts about what happened, answer only the questions asked of you, and do not give up any information not requested.

You should also politely decline if asked to make a recorded statement as the insurer can use this against you later. If you suffer an injury in an accident, report that fact, but refrain from providing specific details until after you’ve seen a doctor.

During the call, your insurance agent will ask you the following information:

Your full name

Your policy number

When your policy started and when it ends

The date of the incident and roughly at what time it occurred

Name, address, and phone number of the drivers involved in the accident, as well as of any passengers and witnesses

Driver’s license number for all drivers involved in the accident

License plate number for any cars involved in the accident

In addition to the above information, the insurance company might require a copy of the police report, if one was filed, and other data, such as the weather conditions, location, and other information deemed important to their investigation of the claim. The insurance company might also ask if you took any photos of the accident to help support your claim.

Driver cell phone laws in California

California law prohibits the use of cell phones while driving, although drivers 18 years of age and older can use hands-free devices to talk on their cell phone while driving. Drivers also must refrain from texting on a cell phone or other mobile device while driving.

Some exceptions to these rules exist, including the use of handheld cell phones:

To make a call in an emergency situation

By operators of authorized emergency vehicles, such as patrol cars, ambulances, and other vehicles

By vehicle operators driving on private property

HOV laws in California

A High-Occupancy Vehicle (HOV) lane serves the purpose of reducing traffic by encouraging ridesharing among California drivers. To use an HOV lane, vehicles must:

Contain two or more occupants of a car or other multi-occupant vehicle

Use an alternative-fuel source, such as a plug-in hybrid, electric, or other such vehicle

Motorcycles and public mass transit vehicles can also use the HOV lane, although school, charter, and sightseeing buses must contain the required amount of occupants to use the HOV lane.

Drivers caught using the HOV lane unlawfully can expect to pay a $490 minimum fine the first time. A higher fine might apply if the driver has violated the HOV lane occupancy restriction in the past and can include additional administrative fees.

As you can see, California has a lot of laws that govern car insurance in the state, ranging from minimum liability amount to what information you need to keep in your car in regards to your insurance coverage while driving to when you need to file an SR-22.